An informed and thought-provoking analysis of what lies behind the headlines and headaches of business ethics and corporate social responsibility

Friday, November 13, 2009

‘Responsible Luxury’

If one takes a taxi from the airport in Bangalore, India, into the city, the first billboard you will see boasts the words: ‘Responsible Luxury!’ It's an ad for a hotel chain, presumably one of those that recently opened another 7-star hotel in the business processing outsourcing capital of the world.

Whatever this phrase means - it pretty much uncovers the enormous contrasts and ambiguities of the economic wonder in India, much of which are epitomized in the 8m population of Bangalore. On the one hand there are the shiny, super stylish office buildings – or ‘campuses’ – of many western and Indian MNCs which have made the city the world’s leading place for IT services and software development. Being on the premises of these companies feels a lot like being in an office environment somewhere in North America or Europe.

On the other hand, Bangalore is a typical ‘third world city’ with constantly jammed up streets, poverty, pollution and shanty towns. The difference between the luxuries of the ‘first’ and the plights of the ‘third’ world could be nowhere more visible.

Now, there are two ways of going about this gap. One option would be to just hermetically isolate those two worlds against each other. We mentioned this approach – referred to as ‘brazilianization’ - in another blog. By the looks of it though, this is not the way things are going in India. India is a long standing democracy, has a vibrant media scene and fairly strong civil society organizations. So what we see here is more an ongoing struggle between these two worlds.

It is interesting to see the role of business in this. For sure, there is a long tradition of business engagement for social needs in India. Companies such as Tata and others have a long legacy of philanthropy and many of the new IT ‘stars’ such as Infosys have followed their example. Talking to business people here one can see a sincere commitment to not just indulge in the luxuries brought along by a booming IT industry but rather make it trickle down to wider parts of society. Responsible Luxury, as it were. How good a proposition that is and if it works ... well, we'll just have to keep you posted.

4 comments:

Bangalore is grwoing even faster than I thought: 8bn people... that's a lot. I guess you meant 8m, right?By the way, the real issue - not only for India - is not to consider responsibility as a luxury but as a basic requirement for a functioning society.

I believe it is true that some initiatives are being taken by certain companies in India to have the benefits from booming industrialisation trickle down into the masses. However, I think that sometimes there is an inability to recognise these apparent social problems. From experience, the shanty towns have become 'fixtures', so to speak, in most cities in India - at which Indians commonly look at without any emotion or concern - in short, they have become too used to the poverty around them. For example, for the Commonwealth Games 2010, I was shocked to see that the government, instead of keeping its promise to rehabilitate a lot of the residents of shanty towns, actually decided to put up bamboo shields around them, so that they are not visible to the public. More disappointing was that there was very commentary from the public, the media or corporate firms on this issue. I think that before this mindset of invisibility is fixed, few companies will actually gear themselves towards philanthropy and fewer will get national recognition for it (which is a huge demotivator).

I gave a talk on sustainable luxury at a conference on that theme in Delhi earlier this year. Thinking about that in a place like India raises the issue of whose responsibility inequality is, and thus how companies can address inequality in society.

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Andrew Crane [L] and Dirk Matten [R]

Welcome to the Crane and Matten blog - for informed commentary and expert analysis on the everchanging world of corporate responsibility.

We are two business school professors best known for our books and research articles on business ethics and corporate citizenship. We wrote the Crane and Matten blog from 2008-2015, offering unique insight on a range of issues from across the globe.

Andrew Craneis Professor of Business and Society in the School of Management, University of Bath.

Dirk Matten is the Hewlett Packard Chair in Corporate Social Responsibility in the Schulich School of Business, York University.